There was an excellent article in the Guardian on Tuesday the 19th. It describes a variety of impacts from marijuana legalization on race and social issues as well as makes very clear the black market is still alive and well, thanks to these issues and the 30% tax rate.
At the outset I implore you to read the whole thing - it's not long. Because of Fair Use limitations I will focus mostly on the impact of the ridiculous tax rate and how that's playing out
It contrasts the upscale/middle class-ness of the marijuana dispensary world, in business with licensed growers who were able to be all the stringent requirements, including clean criminal records with people who have been busted and are now excluded from legal purveyance of the Herb and make up the black market.
Over the roil of orange smoke
Black market boom lays bare a social divide in Colorado’s marijuana market
Camouflaged amid the legal medicinal and recreational marijuana market, the underground market thrives. Some in law enforcement and on the street say it may be as strong as it’s ever been, so great is the unmet local and visitor demand.
- - -
A July study of Colorado’s marijuana market and demand for the Colorado department of revenue estimates total adult demand, including out-of-state visitors, at about 130 tonnes in 2014. Of that, licensed retailers are expected to supply 77 tonnes, most of it from medical marijuana outlets. That leaves what the report calls a “sales gap” of about 53 tonnes of projected unmet demand. Enter the licensed home growers, the people buying legally and reselling illegally, the illegal grow and distribution networks. Marijuana production in the state “is like a shoe factory”, Balles says. “You’ve got the ones that go to Nike and the ones that go to the flea market. One way or another, it all gets sold.”
The article notes that this may be still preliminary: it's been 7 brief months since marijuana became legal to buy and this black market may dry up if legal retailers can get enough approved herb to sell.
On the other hand, and as I think, that 30% tax rate is going to be more than the Hand of the Free Market will tolerate and the black market will continue.
But the racial-social dynamics of the war on drugs create what I used to call "Pat Buchanan Model of Legalization" Marijuana should be legalized...but for white people first". It was always just a joke about Pat being a racist.
Lo and behold...
In this light, taxation is seen as a blunt instrument of exclusion, driving precisely the groups most prosecuted in the war on drug further into the arms of the black market. In one Denver dispensary, a $30 purchase of one-eighth of the Trinity strain of cannabis includes $7.38 in state and local taxes – a near 33% rate. As Larisa Bolivar, one of the city’s most well-known proponents of decriminalising marijuana, puts it: that $7 buys someone lunch.
Pretty simple. That tax is just too much for a lot of people. A lot of people will buy off the black market to save that money. And I am not so sure the author's math is correct: I come up with 24% tax not 33%. Still, 8% is sufficient.
I digress....
Law Enforcement seems to want to deny this or explain it away; they seem to think people just need to follow the law, but people follow money and their bellies much more closely.
Same would go for buying as well, I assume.
There may be an argument there, says Lieutenant James Henning, who heads Denver police department’s vice/drug bureau, but one, don’t expect much sympathy and two, “you have to follow the law. If you want to sell marijuana, find a way to sell it legally.”
So yeah, marijuana is legal out there in Colorado, under certain conditions: conditions which appear to replicate other elements of our society where certain groups get preferential treatment and others get ground down.
And it is the fine men and women of law enforcement dutifully protect and serve the chosen while doing the grinding.
We see that a lot these days.
Get rid of that exorbitant tax rate and much of what is described here would most likely ease up.